What are scope 1, 2, 3 greenhouse gas (GHG) emissions?
There are three categories of GHG emissions:
Scope 1 encompasses direct emissions from sources that are owned or controlled by a company.
Scope 2 are indirect emissions resulting from the generation of electricity, heat, steam, or cooling purchased by a company.
Scope 3 are all indirect emissions (not included in Scope 2) that occur in the value chain of the company.
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Start by measuring your carbon footprint and understanding your risks and opportunities.
What are scope 1, 2, 3 greenhouse gas (GHG) emissions?
There are three categories of GHG emissions:
Scope 1 encompasses direct emissions from sources that are owned or controlled by a company.
Scope 2 are indirect emissions resulting from the generation of electricity, heat, steam, or cooling purchased by a company.
Scope 3 are all indirect emissions (not included in Scope 2) that occur in the value chain of the company.
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Commit to reach Net Zero GHGs as soon as possible in line with global efforts to limit warming to 1.5℃. Set interim targets and define the strategy needed to achieve both the interim and longer-term targets.
What is Net Zero?
Net Zero refers to a state in which the GHGs going into the atmosphere are balanced by removal out of the atmosphere. It is international scientific consensus that in order to mitigate global warming, global net human-caused emissions of carbon dioxide need to fall by about 45% from 2010 levels by 2030 and reach Net Zero around 2050.
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The avoidance or reduction of GHG emissions should be prioritised in the journey towards Net Zero.
What is the role of renewable energy and Renewable Energy Certificates (RECs)?
Renewable sources including solar, wind and geothermal play a critical role in climate action as they do not emit GHG into the atmosphere when generating energy. A REC is a market-based instrument that certifies the bearer owns one megawatt-hour (MWh) of electricity generated from a renewable energy resource. Companies can reduce emissions by generating or purchasing power from renewable sources, or by purchasing RECs to offset the power generated from non-renewable energy sources.
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Offsetting is a widespread tool used in efforts to achieve Net Zero emissions. Use high quality offsets that are verifiable and correctly accounted for, and have a low risk of non-additionality, reversal, and the creation of negative unintended social or environmental harms.
What are carbon offsets and credits?
A carbon offset broadly refers to a reduction in GHG emissions – or an increase in carbon storage – that is used to compensate for emissions that occur elsewhere. A carbon credit is a transferable instrument certified by an independent certification body, that represents an emission reduction of one metric tonne of carbon dioxide (or GHG equivalent).
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Engage stakeholders on your Net Zero journey. Communicate transparently your current emissions, targets and the strategy needed to achieve your goals. Share actions taken so that progress can be tracked and leadership demonstrated.
How to communicate transparently about your carbon footprint?
The organisational, geographical and emissions scope of your carbon footprint should be clearly specified, and standardised and internationally-recognised calculation methodologies used. Disclose the breakdown by scope of your emissions and by category of emissions.
Insights
SMEs hold the key to climate action in Singapore
As part of the Singapore Green Plan 2030, Singapore has implemented a slew of regulations and measures to reduce its environmental impact in line with internationally agreed targets contained within the Paris Agreement.
Driving renewables in a time of change
This report looks at how RE100 members have progressed in reaching their 100% renewable electricity targets, and the challenges they have faced.
COP27 Outcomes: progress and pitfalls in the race to net zero
COP27 in many ways felt like the world’s last chance to keep global temperature increases to within 1.5°C. As the world continues to be ravaged by climate impacts and parallel crises, world leaders assembled in Sharm el-Sheikh to restore faith in multilateralism and agree a plan for addressing the greatest and most urgent challenge of our time.
The CEO’s ESG dilemma
A consensus has emerged in recent years that environmental, social, and governance (ESG) issues are crucially important for the corporate world. But what should companies do about investors who won’t accept lower returns in order to further ESG goals?
How companies can effectively measure and manage Scope 3 emissions
The task may seem daunting, but confronting this challenge head-on can bring business advantages
Accelerated action on climate change requires all hands on deck
Whether a company is at the vanguard of scientific breakthroughs, is among the first adopters whose commitments make breakthroughs commercially viable or is only now getting started on using technology to enhance sustainability goals, much of the progress needed at every company depends on more mundane aspects of day-to-day operations. And although any technology on its own can enable sustainability, it is the convergence of technologies that yields the most powerful decarbonisation results and facilitates the measurement of sustainability at the same time.
The rise of the circular economy
Tackling climate change means radically transforming the vast network of infrastructure which makes the modern world go. Big-ticket items such as power generation, transport, buildings and industry make up more than 60% of global greenhouse gas emissions. But, as the coalition of 197 nations strive to meet the Paris Agreement to decarbonise the global economy by 2050, the speed, scale and cost of the transition required to ‘green’ these assets are posing serious challenges to policymakers, business leaders and transnational organisations.
Achieving net zero infrastructure
Affordability of the global infrastructure transition should be at the top of world leaders’ agenda. Tackling climate change means radically transforming the vast network of infrastructure which makes the modern world go. Big-ticket items such as power generation, transport, buildings and industry make up more than 60% of global greenhouse gas emissions. But, as the coalition of 197 nations strive to meet the Paris Agreement to decarbonise the global economy by 2050, the speed, scale and cost of the transition required to ‘green’ these assets are posing serious challenges to policymakers, business leaders and transnational organisations.
Financing the Net Zero Transition
Reaching net zero, a state in which our global systems emit only as much carbon as they can absorb, will be the biggest collective action humanity has ever undertaken. After all, 84% of the world’s energy still comes from fossil fuels. Achieving net zero will require a full rewiring of the global economy.
Progress and peril on the road to net zero
The path to decarbonization is uneven and daunting, but we have the capacity to spur change. Reaching net zero, a state in which our global systems emit only as much carbon as they can absorb, will be the biggest collective action humanity has ever undertaken. After all, 84% of the world’s energy still comes from fossil fuels. Achieving net zero will require a full rewiring of the global economy.
Accelerating Sustainable Development in the 4th Industrial Revolution
The technologies of the 4th Industrial Revolution (e.g. Artificial Intelligence, Blockchain and the Internet of Things, among others) are rapidly becoming mainstreamed, enabling transformation of entire systems and networks. Widespread change can be seen across companies, industries, countries and society as a whole. These profound shifts, touching nearly every sector, from incumbents being disrupted to entirely new 4IR-enabled business models, are creating new markets at an expedited speed and scale.
A rising tide of green capital
Time and again, we’ve seen excitement build around new technologies—the railroad, electricity, the personal computer, fiber optics, e-commerce. Early investors place risky bets on seemingly oddball ideas. As a few gain traction, the money (and the hype) follows. As a market develops, large investors—venture capitalists, private equity firms, Wall Street—pile in and help scale up technology.
The true test of climate resilience
When I sit down with business leaders, many tell me they believe it’s important to manage the impacts of climate change on their business. But what does it mean for a business to be truly climate resilient? Our teams are seeing firsthand how forward-thinking companies are taking action to help ensure enduring success in a business environment that is being rapidly transformed by climate challenges.
Greenhouse gas reporting rules and pitfalls to be aware of
In our recent article on technology, media and telecoms businesses’ greenhouse gas (GHG) emissions, we explained why it’s now imperative for the TMT industry to take climate reporting seriously. As highlighted, one of the key reasons was the imminent release of mandatory GHG reporting rules from the US SEC.